Why Am I Getting an Insurance Bill If My Policy Is Escrowed?

If your homeowners insurance is paid through your mortgage escrow account, receiving a bill in the mail can feel confusing and frustrating. You’re not alone. This is one of the most common questions we get, especially when a policy shows a pending cancellation notice.

Let’s break down what’s going on.

How Escrow Payments Typically Work

When your policy is escrowed, your mortgage company collects a portion of your insurance premium each month as part of your mortgage payment. When your policy renews, they usually send a single payment directly to your insurance company. That initial payment is often the only automatic payment they make for that policy term.

So Why Am I Receiving a Bill?

There are a few common reasons:

1. The mortgage payment hasn’t been sent yet. Sometimes there’s a delay on the mortgage company’s end. Even if you’ve paid your mortgage on time, the insurance payment may still be processing or hasn’t been issued yet.

2. A balance remains after the initial payment. If your mortgage company underpays the premium (which can happen due to estimate differences or escrow shortages), the remaining balance becomes your responsibility.

3. A policy change was made. If you’ve made any updates like changing coverage, adding endorsements, or adjusting deductibles, this can result in an additional premium. Mortgage companies typically do not automatically send additional payments after the initial disbursement.

Why This Can Lead to a Cancellation Notice

Insurance companies send cancellation notices when there’s an outstanding balance, regardless of escrow status. Unfortunately, mortgage companies generally do not monitor or respond to these follow-up billing notices, which means:

• They may not send additional funds

• They may not be aware of the remaining balance

• The policy can move into pending cancellation status if the balance isn’t addressed

What Should You Do?

If you receive a bill or notice:

• Don’t ignore it, even if your policy is escrowed

• Reach out to your mortgage company to confirm if payment has been sent

• Contact our office so we can help review the situation with you

• If needed, be prepared to make a payment to avoid a lapse in coverage

  
  

Final Thoughts

We know this process isn’t always clear and it can be frustrating to feel like something is being paid twice or missed entirely. Our team is here to help make sense of it and keep your coverage in place without interruption.

If you ever receive a bill you weren’t expecting, please reach out. We’re happy to walk through it with you and help coordinate with your mortgage company if needed.

(207) 363-7894 | www.tapleyagency.com | 300 York St . PO Box 808 . York, Maine 03909